Many Americans are prepping for the holiday season. Traders are also prepping their watch lists for potential opportunities in the market. A couple of leveraged ETFs to keep an eye on center around gas prices and the retail sector.
With much of the world settling back into a post-COVID environment again, holiday travel is picking up this year. Thankfully, that will be paired with lower gas prices. This is a welcome sign for those expecting to do most of their traveling on the road.
“As millions of Americans gear up to hit the road for Thanksgiving, the national average is seeing its longest streak of declines in over a year, reaching a ninth straight week as gas prices fall to their lowest since January,” said Patrick De Haan, head of petroleum analysis at GasBuddy. “GasBuddy now counts over 65,000 stations with a price of $2.99 per gallon or lower. While 11 states are seeing average prices below $3.”
With the price of gas dropping, traders may want to give the Direxion Daily S&P Oil & Gas Exp. & Prod. Bear 2X Shares (DRIP) a closer look to double down on bearish bets. The fund goes in the opposite direction of GUSH, seeking daily investment results of 200%, or 200% of the inverse (or opposite), of the performance of the S&P Oil & Gas Exploration & Production Select Industry Index.
Weaker-Than-Expected Holiday Shopping?
The retail sector typically braces for a busy holiday shopping season, but that may not be the case this year. Higher interest rates coupled with rising consumer prices may force consumers to limit their spending this year as retailers across various product markets expect weaker demand.
“Economic demand in the United States has slowed, as October’s retail sales figures showed,” a Reuters report said. “Numerous retailers said on Tuesday (November 21) that holiday outlook is mixed after a choppy start to the fourth quarter when most Americans gear up for Christmas shopping.”
With the retail sector, traders may want to keep an eye on the Direxion Daily Retail Bull 3X ETF (RETL), which seeks daily investment results of 300% of the daily performance of the S&P Retail Select Industry Index. If the economy manages to stave off a recession and consumers’ confidence returns in a big way, the retail sector could benefit, providing an opportune time to purchase a potential dip if holiday shopping numbers disappoint.
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